This week’s New York Business Divorce highlights an important decision by the Appellate Division, First Department, construing rights of advancement and indemnification for litigation expenses in a battle royal between majority and minority members of a limited liability company.
Continue Reading New York Court Follows Delaware Law to Construe Advancement and Indemnification Provisions of Florida LLC’s Operating Agreement
Court Rejects Bid by Corporate Dissolution Petitioner to Voluntarily Withdraw Case Without Prejudice
If you’re going to accuse your business partner of bad acts and ask for judicial dissolution of the business, be prepared to settle or take the case all the way to trial. That seems to be the message given to the petitioner in a recent case highlighted in this week’s New York Business Divorce, when the court turned down her request to withdraw the case “without prejudice.”
Continue Reading Court Rejects Bid by Corporate Dissolution Petitioner to Voluntarily Withdraw Case Without Prejudice
Stock Valuation, Dr. Pangloss, Mr. Scrooge and Do-Overs
A recent appellate decision, ordering a new stock valuation hearing in a case marked by incomplete expert testimony and inadequate findings by the judicial hearing officer who heard the valuation evidence, prompts thoughts on the use of hired-gun experts in this week’s New York Business Divorce.
Continue Reading Stock Valuation, Dr. Pangloss, Mr. Scrooge and Do-Overs
Top 10 Business Divorce Cases of 2008
Have room for one more 2008 top-10 list? This week’s New York Business Divorce highlights the 10 most interesting business divorce cases from last year, with updated case citations and links to previous write-ups.
Continue Reading Top 10 Business Divorce Cases of 2008
Court Rejects Attempt to Vary Statutory Valuation Date in Oppressed Shareholder Buyout
DUE TO TECHNICAL GLITCH, THIS ENTRY WAS PUBLISHED THIS MORNING INCOMPLETE. THIS WILL LINK TO THE COMPLETE ENTRY. MY APOLOGY FOR THE DUPLICATE EMAIL NOTIFICATION. P.A.M.
The statute governing buyouts in oppressed shareholder dissolution cases dictates that the fair value of the shares is to be determined as of the day before the date on which the dissolution petition was filed. This week’s New York Business Divorce looks at a quirky case involving a fight over which of two proposed valuation dates was the proper one, with $1,000,000 in assets hanging in the balance.
Continue Reading Court Rejects Attempt to Vary Statutory Valuation Date in Oppressed Shareholder Buyout
Fiduciaries, the Duty to Disclose and the Incredible Shrinking Release
A recent decision by Commercial Division Justice Charles E. Ramos in the case of Arfa v. Zamir grabs the spotlight in this week’s New York Business Divorce. The subject is an important one to business owners and their counsel: Does a general release in an out-of-court agreement between business partners/fiduciaries provide any protection against allegations of fraudulent nondisclosure?
Continue Reading Fiduciaries, the Duty to Disclose and the Incredible Shrinking Release
Court Bars Minority Member From Intervening in Creditor’s Suit Against LLC
Does a minority member of an LLC have a right to intervene in an action against the LLC by a creditor? How about if the creditor’s claim arises from collusion or other impropriety by the controlling member? This week’s New York Business Divorce provides answers courtesy of a recent appellate court ruling in the curious case of Baron v. Rocketboom LLC.
Continue Reading Court Bars Minority Member From Intervening in Creditor’s Suit Against LLC
Appellate Court Finds Operating Agreement “Silent” on Sale of LLC’s Sole Asset, Upholds Approval by Majority Vote Under Statute’s Default Rule
Last month the Appellate Division, Second Department issued an important decision concerning the application of the LLC Law’s default rules where the operating agreement is silent on a disputed issue. Get up to speed with this week’s New York Business Divorce.
Continue Reading Appellate Court Finds Operating Agreement “Silent” on Sale of LLC’s Sole Asset, Upholds Approval by Majority Vote Under Statute’s Default Rule
Poorly Drafted Disability Clause in Operating Agreement Provides Novel Defense to LLC Dissolution Proceeding
If you think you’ve seen it all when it comes to corporate dissolution contests, think again as you read this week’s New York Business Divorce which looks at a case in which one LLC member opposed the other’s dissolution petition based on the latter’s alleged mental disability.
Continue Reading Poorly Drafted Disability Clause in Operating Agreement Provides Novel Defense to LLC Dissolution Proceeding
Disputed Allegations of Shareholder Oppression Require Evidentiary Hearing
The necessity of an evidentiary hearing is a threshold issue in corporate dissolution proceedings. A recent decision by Suffolk County Commercial Division Justice Emily Pines serves up a good illustration of how courts approach the issue. Read more in this week’s New York Business Divorce.
Continue Reading Disputed Allegations of Shareholder Oppression Require Evidentiary Hearing